1. Field of the Invention
The present invention generally relates to systems and methods for determining pricing of prescription medications and similar goods and for implementing transparent pricing models for prescription medications. Specifically, it relates to computer systems for performing such methods.
2. Description of the Related Art
Healthcare spending has been estimated as being more than 15% of the GDP of the United States and one of the largest segments of the economy on which money is spent totaling in at over two trillion dollars a year. Even with this much being spent, however, there are questions as to how effective the spending is.
Recent political concerns exist that not enough healthcare is available and what is available is too expensive for what it provides. Further, there is a running popular sentiment that many in the healthcare industry get rich catering to those who are desperate for their products while keeping the cures away from those who won't pay what are sometimes seen as exorbitant prices. There are proposals to try to improve the access to care for a variety of individuals at lower costs but, while society may generally support granting these people access to care, a perpetual problem is how to pay for it and how to know that money is being spent wisely.
One of the principal targets of concern is prescription medication pricing. Currently, the cost of prescription drugs is of significant concern for a number of businesses and government entities that supply health insurance and health care plans, as well as the population as a whole. There are bus trips for seniors to go to Canada to purchase prescription medications where they are less expensive than in the United States as it is seen that many, particularly brand name, medications are simply to expensive to be affordable on a fixed income. Even for those that can afford the drugs, there is concern about determining if medications are actually provided by a pharmacy at a reasonable cost since there is very little possibility of an end consumer comparison shopping their prescription.
Recently, a number of pharmacies have made headlines by offering fixed price, relatively low cost, prescription medications and refills for many commonly prescribed medications. These acts are being copied by other pharmacies and have definitely provided a lower cost alternative for these specific medications. At the same time, in some instances, these programs can actually result in a net loss for the pharmacy. They are providing pharmaceuticals at a cost which cannot cover their expenses and expect to make up the difference from other sales that may occur at the same time to the same customer, or simply from improved customer goodwill. In some cases, the pharmacies may not even realize they are losing money on the transactions as they cannot effectively analyze their costs on those prescription medications provided under the program. In still other cases, these prices may provide for large profit margins.
One problem with the fixed price arrangement is that not all prescriptions for the same medication prescribe the same amount. For example, in one person's prescription, the one month usage may comprise 30 pills (one per day) while in another person's prescription, the usage may be 60 pills (two per day). If fixed pricing is setup based on the smaller prescription, but the large is more common, the pharmacy may be dispensing at a net loss. Similarly, if the pharmacy bases the pricing on the larger prescription, they may not be cost competitive on the smaller one. Similarly, an initial prescription for one person may be 14 doses with a refill for another 14 doses, while for another its 28 doses without an available refill resulting in two “fills” for the first but only one for the second. Because of problems such as this, many fixed cost prescription services limit the available medications to specific drugs where dosing may be more standardized and costs may be more fixed.
Companies that sell prescription fulfillment services and the related medications often have to distinguish themselves on price factors (or improved service or hours) only, as the goods they sell are essentially identical to those sold by others. Further, simply reducing or increasing a price may not always result in a maximized profit for the business as lowering the price too far can result in insufficient profit from the sale and raising it too much can result in potential customers going elsewhere. For this reason, the ability to determine pricing for prescription medications which allows for the business to maximize sales under a given business model can be important. Further, even if a point of maximum return cannot be obtained, the ability to detect trends which can direct a business to a pricing model which improves profits is clearly desirable.
Such pricing, however, can be difficult because pharmaceutical pricing is often not transparent as contemplated above. Instead, the specific costs associated with any particular medication can be difficult to determine due to variability on the size and nature of the transaction. Thus, it can be very difficult to determine if a chosen price is desirable.